Guest Post: Where do Processes of Nature End and Processes of Human Invention Begin?

The following excerpt comes from Professor Robin Feldman's forthcoming Harvard University Press book Rethinking Patent Law which will be released in 2012. The excerpt is reproduced with permission from Harvard and Professor Feldman.

Looking from the perspective of preemption can be helpful in developing an approach to many of the questions generated by the emerging field of personalized medicine. Personalized medicine is an area of applied research devoted to developing tests that operate on biological and clinical data from a patient (e.g., protein levels, genetic mutations, medical history) to provide diagnoses, prognoses, and treatment regimens specific to the patient. Cases arising in this field include LabCorp, which concerned correlating elevated homocysteine levels with certain deficiencies, and Prometheus, which concerned determining metabolite levels after administering a particular class of drugs for gastrointestinal disorders and adjusting the dosage of the drug based on the metabolite levels.

As discussed earlier, the Federal Circuit's decision in Prometheus seemed to suggest that most life science inventions would satisfy the requirements of patentable subject matter, while the PTO's application of Prometheus could lead to the rejection of numerous inventions in this arena. Neither extreme is necessary if one focuses on preemption of laws of nature and natural phenomena as the primary concern.

For example, LabCorp was a relatively simple application of personalized medicine. It involved one biomarker and a reasonably straightforward correlation for treatment. In contrast, most personalized-medicine diagnostics are developed using whole genome expression or sequencing arrays to identify hundreds or even thousands of biomarkers that can be used to diagnose a specific disease state. The machine learning algorithms used to identify these markers do not operate on statistical concepts as simple as linear correlation, which for some of us is complicated enough. Machine learning algorithms employ statistical models to identify different combinations or "patterns" of markers that correlate with a specific disease state. Usually these markers are selected and statistically modeled to compensate for human genetic and environmental variation.

Thus, most personalized-medicine programs are tremendously complex compared even to logistic regression and other simple forms of statistical analysis. They are not simply a reflection of a natural phenomenon; they are an interpretive model of nature. Nor are they analogous to or preemptive of human thought. It would be quite improbable for a physician to be able to sit down with a pen and paper and work out a diagnostic by applying a machine learning algorithm or logistic regression to hundreds of biomarker levels.i

Consider the first person who discovered that human chorionic gonadotropin (hCG) levels indicate pregnancy when they are elevated above a certain level, and assume that the inventor also created a home pregnancy test for measuring the hCG. One could think of this as a simplistic personalized diagnostic device in which a particular nongenetic marker is measured to identify a state of health. The inventor could certainly patent the kit, which would consist of the physical device with its particular components. The inventor should not, however, be allowed to patent the process of testing human urine for an elevated level of hCG and correlating that level with the state of pregnancy. The core of the invention, the fact that hCG above a particular level confirms pregnancy, is a simple reflection of nature rather than an interpretive model. To understand the difference, compare the process of measuring one marker by looking for a simple level to the average personalized invention. The modern personalized invention may utilize hundreds of biomarkers analyzed by means of statistical patterns. Even if the complex process involved in identifying the relevant biomarkers yields a limited number of biomarkers to consider for a relevant patient, that information does not relate directly to anything. For example, with a personalized medicine invention involving only a few biomarkers, each of those markers generally has confidence intervals assigned to indicate the likelihood that the presence or absence of a factor or the particular level of that marker will translate into a particular diagnosis or successful treatment. Once biomarkers are collected from a relevant patient, they must be processed by statistical modeling to determine how the various factors and confidence levels for this particular patient should be interpreted. The complexity and variability of individual humans ensures that a model like this can never be a simple reflection of nature. Rather, it is no more than an interpretation of nature, albeit one that is extremely important in the treatment of a specific disease.

In contrast, the inventor of the method of measuring hCG is looking at only one marker, and it is a marker that is elevated in the same range for pregnant women in general. Thus, it requires no complex modeling and is a direct reflection of a phenomenon of nature. As a result, it would not be patentable subject matter on the grounds that the core of the invention is no more than the discovery of a natural phenomenon.

The hCG invention should also fail on the grounds that performing the test is no more than a mental step. The method does not require complex computer analysis to interpret the data; it requires observing a particular level of a substance and reaching a conclusion from that level. Preventing human beings from looking at information and concluding something threatens to preempt simple thought.

Personalized medicine, with its marriage of biology and computer technology, provides a wonderful opportunity to understand and tease out some of the threads of patentable subject matter. These inventions demonstrate how early misconceptions about the nature of computer programs and the nature of mathematics are causing problems in modern case law.ii

Part of the difficulty can be traced to confusion between the content of something that is being expressed and the language in which it is expressed. For example, we know that laws of nature are not patentable. Some of these laws are familiar to us in the formulaic language in which we normally see them expressed. Most people, for example, would recognize one of Einstein's laws of physics expressed as E = MC2. One could express that same law in prose, however, rather than formulaic language by explaining the way in which matter and energy are interchangeable.

The choice of language is irrelevant.iii We disallow patenting of E = MC2 not because it is expressed in mathematical form but because it represents one of the building blocks of scientific exploration and endeavor. Patenting that law would preempt scientific exploration by occupying a basic concept.

In addition to laws of physics, other things can be expressed in formulaic language. Expressing something in formulaic language, however, does not mean that what is being expressed is a law of nature. Thus, the fact that computer programs are expressed in a formulaic language that looks somewhat like math to the layperson does not mean that the concepts underlying a particular program are analogous to math, let alone analogous to a law of nature. Two things expressed in the same language or the type of same language are not necessarily analogous. Comic books and the Constitution are both expressed in the English Language, but they are hardly analogous. Our focus should remain on the content of what is being expressed and on the preemptive effect that might result from patenting that type of content.

Some unfortunate language in the Supreme Court's Diehr opinion, which flows from this misperception, makes it more difficult to properly separate software claims that should be patentable from ones that should not. In searching for logic to explain why the rubber-molding invention at issue was patentable while other apparently similar inventions had failed, the Court made the following comment: "A mathematical formula as such is not accorded the protection of our patent laws, and this principle cannot be circumvented by attempting to limit the use of the formula to a particular technological environment."iv

Other courts have jumped on the language to declare that so-called field of use restrictions cannot save software patents.v Even the recent Supreme Court opinion in Bilski wandered into the same territory when referencing its earlier decision in Flook:

Flook established that limiting an abstract idea to one field of use . . . did not make the concept patentable. That is exactly what the remaining claims in petitioners' application do. These claims attempt to patent the use of the abstract idea of hedging risk in the energy market and then instruct the use of well-known random analysis techniques to help establish some of the inputs into the equation. Indeed, these claims add even less to the underlying abstract principle than the invention in Flook did, for the Flook invention was at least directed to the narrower domain of signaling dangers in operating a catalytic converter.vi

It is true, as a general matter, that if one were to claim a law of nature, the claim would not be rendered patentable by limiting use of that law of nature to a particular field. Thus, for example, an inventor could not save a claim to all uses of E = MC2 by limiting the claim to "all uses of E = MC2 in the construction field."

Sliding the analogy over to software, however, involves logical errors. The logic that appears to have been used is the following. Computer programs are mathematical formulas, and mathematical formulas are laws of nature. We know that laws of nature cannot be rendered patentable by limiting their application to a particular field of use. Computer programs, therefore, cannot be rendered patentable by limiting their application to a particular field of use.

This sequence contains a number of logical errors. Computer programs may be expressed in a language that looks like math, and some do involve calculations, but they are not necessarily analogous to mathematical formulas. Most important, they are not analogous to natural laws just because both are expressed in formulaic languages. One must look to the content of the computer program and its potentially preemptive effect to determine patentability.

As described earlier, the term "algorithm" in computer science means a series of steps performed on input data by a computer. This process may or may not raise preemption concerns. Some computer "algorithms" are based on properties inherent in types of input and output data. Such broad, generic algorithms, which can be used on a variety of types of input data, may raise threats of preemption. In other words, if an inventor asks for a patent on a software program that works with whole sets of numbers or entire types of data, such a patent would not be patentable subject matter. Particularly in light of the bargaining potential that would come with such a grant, the patent would risk tying up entire types of data rather than constituting something applied.

This does not mean that all software is unpatentable. Claims to programs that are applied to a specific type of data in the pursuit of particular types of outputs do not present the same level of preemption threat. For example, a personalized medicine algorithm (i.e., series of steps) that employs a specific type of statistical model using a fixed set of markers to produce a very specific diagnosis would not threaten to preempt other methods of performing the same diagnosis that use different markers or novel types of statistical models. Such an invention should be patentable.

Computer programs may be many things, including methods of creating useful models of the world around us, methods of providing interpretations of information, and methods of sorting information. When methods of creating a particular type of model are described at a very general level, they may threaten to preempt the broad activity of exploration. However, when claimed at the level of a specific method of sorting a particular type of information for a particular pursuit, they should constitute an applied invention. Such specificity is the hallmark of what separates unpatentable abstractions from applications of those abstractions in the useful arts in a way that is worthy of patent protection.

* * * * *

i One scholar has suggested that even LabCorp could have survived as patentable subject matter if the claims drafter had chosen a narrower description. See Patricia Dyck, "Post-Bilski Personalized Medicine: At Home on the Range" (forthcoming) (manuscript on file with author) (presenting an empirical survey of the most frequently claimed biomarkers in personalized medicine and discussing problems in allowing claims for sets of biomarkers that are small and not limited to the diagnosis of a specific disease state or condition).

ii I have discussed some of the misconceptions described here in the context of patenting genes. See Feldman, "Whose Body Is It Anyway?" 1400–1402.

iii One could easily argue that all math is invented. It is a human-made method of imposing order and structure on the natural world. For an interesting and accessible discussion of Wittgenstein's view that all mathematics is a human invention and various responses to that argument, see Ludwig Wittgenstein, Wittgenstein's Philosophy of Mathematics §3.1, http://plato.stanford.edu/entries/wittgenstein-mathematics.

428 thoughts on “Guest Post: Where do Processes of Nature End and Processes of Human Invention Begin?”

Not that we need to start this up again. But just for the record it is Ned Heller that dishonestly claims the Supreme Court uses “the MOT” as a test, not Annie Mouse. Mouse was/is an honest blogger on here.

Having read the entire thread it can be said with absolute certainty that you do not post honestly.

You have contended that “the MOT” was announced and introduced in Supreme Court case law prior to Bilski when a simple search of Supreme Court case law finds zero references to “the MOT”.

You also imply that a requirement existed for passing “the MOT” in Supreme Court case law by repeatedly stating that Diehrs claims passed “the MOT” when again a simple search of the law finds zero references to any claims being subjected “the MOT” in Diehr or any Supreme Court case law.

Conjecture is no substitute for proper citations and mixing personal opinion is no substitute for actual law

I think the Supreme Court, especially Justice Kennedy, would agree with you that the Bilski decision sounded a lot like a 102 decision. He said as much during oral argument in the recent Prometheus case.

But in the larger view, perhaps Kennedy was saying that fundamental laws of economics cannot be appropriated via the patent monopoly to one person, even if he or she is the first to discover the principle. If this is the case, the Supreme Court has essentially offered a new category of subject matter that is excluded from patent eligibility, one that recognizes that laws of economics are equivalent to laws of nature.

Struggling to see the policy argument at 12:04 pm, unless the policy position is that it is OK for the Supreme Court to flub basic principals of patent law (like the difference between 101 and 102/103).

IBP, I totally agree with you on jury instruction angle. Prior art, better than any before the examiner, will have a strong effect in court because of the jury instructions to the effect that the PTO has not considered it.

Getting the best prior art before the examiner is important not only to prevent an adverse jury instruction, but the insulate a patent against a re-examination over the same or equivalent art. Furthermore, if the claims do have problems over the prior art that could be remedied by small changes to the claim language, is best that that be done during prosecution because it cannot be done in court.

IBP, I will consider your view. I think it is right, but consider why:

Clearly the Supremes were disturbed by the fact that the claim broadly described hedging and that hedging was notoriously old. This may have impelled them to act, even where there reasoning was not clear. What they saw was an attempt to patent a business method that was both fundamental and that had long been in use. Such fundamental algorithms, like laws of nature, are truly part of the public domain. If one were to discover a new algorithm that described how economics worked, the basic problem is that the algorithm simply describes something that is old.

But all this sounds in novelty, not in patent eligibility.

The breadth of the claim was important as well, as it did not limit the claim to any non obvious application. But again, this is a 102/103 consideration, not 101 or 112.

Below is the paragraph that explains their reasoning. It is all consistent with what I just said.

“In light of these precedents, it is clear that petitioners’ application is not a patentable “process.” Claims 1 and 4 in petitioners’ application explain the basic concept of hedging, or protecting against risk: “Hedging is a fundamental economic practice long prevalent in our system of commerce and taught in any introductory finance class.” 545 F.3d, at 1013 (Rader, J., dissenting); see, e.g., D. Chorafas, Introduction to Derivative Financial Instruments 75-94 (2008); C. Stickney, R. Weil, K. Schipper, & J. Francis, Financial Accounting: An Introduction to Concepts, Methods, and Uses 581-582 (13th ed.2010); S. Ross, R. Westerfield, & B. Jordan, Fundamentals of Corporate Finance 743-744 (8th ed.2008). The concept of hedging, described in claim 1 and reduced to a mathematical formula in claim 4, is an unpatentable abstract idea, just like the algorithms at issue in Benson and Flook. Allowing petitioners to patent risk hedging would pre-empt use of this approach in all fields, and would effectively grant a monopoly over an abstract idea.”

Or are you missing the point that the entire post was obviously an opinion – but still, opinions and facts should be treated differently?

Perhaps you think it fine that opinion and fact be treated the same (who knows, you may be a mere “sockie” for one of those ardent Conflators, and what’s a little more conflation going to matter to such a one).

“I couldn’t care less what the merely frivolous and vexatious troll’s estimation is, of my credibility.”

You must have missed my response to your “I don’t care” message.

I don’t care that you don’t care that you look like a boob (I really do not have any consternation over your feelings or actions). However, if you want to be taken seriously – by anyone – there are a few things about posting that you should be aware of. One of them is that “perspicacious” readers (and not just this particular “perspicacious” reader) notice that mixing up opinion and fact and presenting both as the same indicates that you don’t know the difference, and thus, none of what you have say – even if meritorious – will be taken seriously.

Of course, this is a mere blog, so you being taken seriously (or not) is of no consequence. But still, you might want to practice your art, even in this forum, as bad habits do tend to stick with you.

There was some critical dialogue on the post itself (see comments of Dec. 14, for example), but the post was so lacking that a more thorough investigation of some of the basic concepts upon which it purported to rely was required.

The post succeeds at occasioning discussion–not because it is elegant and enlightening, but because it is curtailed and confused.

I have tried to address that confusion by taking the analysis further, and offering a possible explanation for terms and concepts like abstract, pre-emption, laws of nature, and so on.

I hope that my offered explanation proves useful in some way for either or both individual readers or the patent system as a whole.

“While nominally preserving C&C, the evidentiary weight of both unconsidered art and that of any original PTO determination can henceforth be modified pursuant to a jury instruction, to effect an outcome substantially that of POE.

Bottom lines:

1) if you’re litigating, get a jury instruction

2) if you know of art that could prove problematic in litigation, think about getting it before the PTO in prosecution if possible.”

Yes, I understand the standard of proof that arose under common law–but I also understand that it is highly irregular to incorporate a standard of proof into a presumption that is normally associated with only the burden of persuasion.

The SC acknowledged as much when they said that “We recognize that it may be unusual to treat a presumption as alone establishing the governing standard of proof.”

As I stated on an earlier thread, I couldn’t care less what the merely frivolous and vexatious troll’s estimation is, of my credibility.

Much to the consternation of the troll, who still acts as though I care.

Without descending too far into personal subjects, I especially enjoyed the “put on notice” part, as though the troll wielded some authority, and that sanctions were to follow for non-compliance with said “notice”.

This is actually one of the very few threads that I believe could benefit from deletion of a large number of very personal posts, all of which seem to have been either written or occasioned by the troll.

“The nice thing about making blog posts is that they are decidedly not scholarly.”

The nice thing about blog posts is that if you do not care to be taken seriously, you can post anything you want – like opinions framed as fact that destroy credibility.

But IBP has been put on notice of this before, particularly with his chosen ignorance regarding treatment of preambles. Presumption and preambles – as “perspicacious” readers will recognize, posting without regard to credibility lowers the credibility of all one’s posts – even ones that may hold pleasing paradigms. Nice journey hits the nail on the head, showing just how scrambled IBP is.

This may be true but Ned does not really care. He, like all anti patent shills wants to advance an illegal policy of dissecting claims at 102. (Mooney would do it at 101, 102, or 103. )This way their ilk can curtail patent rights for inventors and inventions their employers do not like. In Neds case namely financial products and certain software processes would be wiped out. But rather than be honest about this agenda and put forth a persuasive policy argument as to why such patents should be eliminated they rather, twist, conflate and obfuscate the existing law.

Ned, like I said earlier quoting Kennedy, the term “abstract” was in this case applied to the concept of “pre-emption”, which is the court’s descriptive term for no meaningful limits on application, which was the pre-Bilski understanding of “abstract” as “principle in the abstract, not limited to a particular application”.

Ultimately Bilski lost because the court did not find the particular described limitation on application to have been meaningful, and thereby decided that the principle of hedging was itself claimed, that therefore all applications of said principle were pre-empted, and that the claim was therefore abstract.

As I have said, I disagree with the court’s holding that the described limitation on application was not meaningful.

Bilski won every legal argument in the Supreme Court but still lost. How did that happen?

The Supreme Court held that business methods were not categorically excluded.

The Supreme Court held that process claims do not have to be limited to methods of making and using machines, articles of manufacture and compositions of matter.

So we have a claim, not limited to a process involving machines, articles of manufacture or compositions of matter, and not proscribed for being directed to a business method, being declared not patent eligible because it was abstract. But abstract, prior to Bilski, was understood to mean a “principle in the abstract, not limited to a particular application.” Clearly, under this understanding of abstract, the Bilski claims were an application of the idea of hedging to a particular process, whereby consumers could be sold commodities at a fixed price in face of variable risk.

IBP: “One sees a process of hedging described, which is assumed to be useful because the logic behind it says that it should rationally be useful.”

I see we now agree that the Bilski claims presented a process, and not the abstract idea of, hedging. Rather then just claiming all ways of balancing risk in the abstract, it provided the essential steps a commodity broker would have to take to balance his risk if he were to provide consumer a commodity at a fixed price in an environment where the price of the commodity could fluctuate due to variable risk.

I am not sure whether the claim, if granted, would monopolize all hedging. I doubt it. hedging has been with us for long time. How is it that a new claim to a hedging process could monopolize the concept hedging which had been with us with us for perhaps 10,000 years?

Indeed, as described in the Bilski opinion, the hedging method claimed itself was notoriously old. The real vice in the claim was not that it was abstract, but that it was old or obvious over the prior art, notorious prior art.

But if one assumes for the moment that the Bilski claimed method was new, because it provided consumers the ability to buy a commodity at a fixed price despite risk, it seems to me that the process was not abstract because it set forth a defined series of steps that had clear and unmistakable utility. It permitted the commodity broker to supply the commodity at a fixed price in face of variable risk. This is valuable.

Of course the claim did not past MOT, and thus was a process that was tied to a machine, to an article manufacture or to a composition of matter. But the Supreme Court in Bilski said that patentable processes do not have to be tied to machines, articles or compositions. Even so, in the end, they declared the claims to be abstract, when clearly they were not abstract under a known case law. One has to wonder, again, what the Supreme Court had in mind other than that the claims were notoriously old?

This case presents an illustrative situation for the exercise of patent analysis.

A cursory glance at the claim creates the first impression that the claim is readily understandable, and relatively straightforward.

At first glance, one sees a process of hedging described, which is assumed to be useful because the logic behind it says that it should rationally be useful, and sufficiently described, as the concept is well-understood. The only remaining analyses are novelty and non-obviousness, right?

Wrong.

Upon further inspection, this type of Humpty-Dumpty claim falls off the wall. The claim fragments. The more pieces Humpty breaks into, the more work has to be done by the reader to reassemble the parts using help from elsewhere in the spec, and from general knowledge in the field.

At some threshold number of fragments, all the King’s horses, and all the King’s men, cannot put Humpty together again.

Applicants/patentees should be held to a high standard of disclosure. IMHO, it is wrong for the examiners, the BPAI, and courts should to bend over backwards in a contorted and entirely misguided submission to a mistaken understanding of the presumption of validity.

It should be remembered that a presumption only serves to shift the burden of persuasion to the party advocating a different outcome, break a stalemate in the outcome of arguments, or both. The presumption of validity presumes only that the administrative agency of the PTO has discharged its official duties with regularity, and says nothing about the relative strength or quality of that determination of validity.

Ultimate legal questions of validity are reviewed de novo–what this means, IMHO, is that there is no presumption whatsoever as to the strength or quality of the initial determination–the presumption initially serves a merely procedural role, in that the burden of persuasion of invalidity initially falls upon the party arguing in favor of that invalidity, who must then rebut the presumption using affirmative evidence of invalidity.

Once the first party has produced some affirmative evidence of invalidity, the burden of persuasion then shifts to the party arguing validity.

If, after all arguments are concluded, the court finds neither argument more persuasive than the other, the presumption of validity can be invoked to deem the claim valid. There is no particular strength associated with this tie-breaker type of role, other than a de minimis strength, because the merest scintilla of strength will suffice to tip the sensitive scales of justice.

The presumption of validity places an intact Humpty-Dumpty on the wall. The initial burden on the party arguing invalidity is to do no more than to push Humpty off the wall using legal means–it is then up to the party arguing validity to either show that the means used by the first party were unlawful, or to reassemble Humpty in his initial form and place him back atop the wall, or both if possible.

In many recent decisions, IIRC, Humpty has seemed like a rubber egg to those arguing invalidity–they do their best to push him off, and see him go sailing over the other side–only to see him bounce up back to the top, intact (and smiling).

The practical effect of the presumption should not be to either rubberize Humpty, or to provide a trampoline at the base of the wall. Once he’s off he’s smashed, and it’s up to all the King’s horses and all the King’s men, and not up to the court, to put Humpty together again.

Ned: “There is no meaningful difference between the claimed process of
Diehr and the claimed process of Bilski except that the process in Bilski did not pass the MOT, and therefore was not a traditional process within the holding of Diehr. ”

AI: That’s just your opinion and has no force of law. You cite no case law ever to back up your wishful thinking and amateur mind reading of the Supreme Court.

AI: No claims has ever had to pass the MOT at the Supreme Court because the Supreme Court never created nor enforced a MOT test!

Fact is you Ned Heller can’t cite one case in the history of Supreme Court jurisprudence when any claim was ever required to pass a MOT test!

The claim, as written, is not simple to analyze, but any such analysis should be efficient.

Believe it or not, my analysis has been efficient. I have in fact undertaken not one but several analyses, each successive one assuming that the ones that preceded it were somehow inadequate or improper.

I totally agree with you that the process is neither novel nor non-obvious, but that is not the analysis you requested!

This is a 101 discussion!! Although 112 is necessarily woven into any 101 analysis.

In a case like this one, the 102 or 103 invalidation seeming so easy, if I were a court I would invalidate on either or both 102/103, with the caveat that any analysis undertaken does not recognize either the patent eligibility of the subject-matter under 101 or the patentability of the subject-matter under any other criterion or criteria of patentability, including but not limited to adequate written description under 112 and utility under 101.

A 102 and/or 103 invalidation, even given the field-of-use limitation, would seem to be relatively easy in this case…so what happened? Maybe the examiner had just taken a 101 seminar at the PTO.

Ned: AI, even the very passages you cite say the that the MOT is a test.

AI: Yes Ned, as the passage concluded and we all know, in re Bilski made “the MOT test” and Bilski Vs Kappos struct it down as a sole test. And yes we all know the Supreme Court said while they saw it as a clue, the CAFC could still use it as a test if they want. The point of this particular pin-cite is to prove the CAFC is no longer using it as a test, and treating the presence of machines and transformations as a mere clue, just like Supreme Court does.

Ned: So you are again off on some wild goose chase about the meaning of words,

AI: The pursuit and expectation of the use of logic in a debate is not a wild goose chase my friend. And the meaning of words certainly does count in law. See Diehr on that. As explained before, a clue is not a test and If you continue to contend otherwise I am once again compelled to challenge you to answer the following question, which proves the illogical basis of your own premise.

How doe one pass a clue?

Ned: and are discussing ideas and holdings of case law beyond your understanding.

AI: Once again, demonstrate it. Just saying it over and over will not make it true.

Do I have to spell it out to you that what are considered “Laws of Nature” are not?

Every so-called Law of Nature is merely an approximation made by man, created by man and quite evidently, even those attributed to divine intervention, equally as fallible as anything else “made by man.”

For some reason, some people want to elevate this type of stuff made by man over other types of stuff made by man.

Except that I do not say such a thing. That’ a red herring. Which proves to everyone you do not want to carry out the original argument to it’s logical conclusion, which is that DCAT controls. And in this debate, on this issue, you lose.

AI, what bothers me the most about you is that you deign to lecture others including me as if your were some sort of god and we mere mortals, sitting at your feet. It is your ATTITUDE that offends me the most.

I will not discuss things with you because you show me no respect at all. You lecture me, you do not discuss. In fact, you refuse to discuss issues.

Just for example, your assumption that I am shilling for some outfit. Now get off it, please. I have told you before and I tell you again is that in this area of the law, I am trying to fully understand it. I think the Supreme Court jurisprudence is as clear as mud. Most people would agree with that statement.

You have not real understanding of what you are talking about. The question is not whether MOT test is a test, but whether the test is exclusive or not. The Supreme Court has ruled that it is not exclusive. It did not rule that it is not a test.

So you are again off on some wild goose chase about the meaning of words, and are discussing ideas and holdings of case law beyond your understanding. You pollute this patent reform with nonsense and ridiculous comments. Begone.

Annie, after seeing Neds post at Dec 27, 2011 at 06:00 AM, your post could not be more on target. I concur talking to Ned from this point on is a waste of time. Although it has allowed me to learn a great deal from the other Attorneys that have rebutted him. And for that I am sure to be a better Inventor and submit stronger patent applications that comply with the law.

As for Ned well he will continue to get paid to shill and harass anyone that exposes his agenda.

No Ned, I am not hostile in any way to the “the MOT”. I simply recognize, accept and follow the Supreme Court rulings that hold “the MOT” is a clue.

That the Court has so held is a fact that even you can’t deny, though you ignore it at will.

And while the Court did not rule the CAFC could not elevate the clue to a test, the CAFC did not so choose to do so. And that my well paid friend is the law.

See, Ultramercial,

PIN CITE: In an effort to grapple with the non-statutory “ab- stractness” limit, this court at one point set forth a ma- chine-or-transformation test as the exclusive metric for determining the subject matter eligibility of processes. In re Bilski, 545 F.3d 943, 956 (Fed. Cir. 2008), aff’d on other grounds, Bilski, 130 S.Ct. 3218. The Supreme Court rejected this approach in Bilski, noting that the machine- or-transformation test is simply “a useful and important clue, an investigative tool, for determining whether some claimed inventions are processes under § 101” and is not “the sole test for deciding whether an invention is a patent-eligible ‘process. While machine-or-transformation logic served well as a tool to evaluate the subject matter of Industrial Age processes, that test has far less application to the inventions of the Information Age. See id. at 3227-28 (“[I]n deciding whether previously unforeseen inventions qualify as patentable ‘processes,’ it may not make sense to require courts to confine themselves to asking the ques- tions posed by the machine-or-transformation test. Sec- tion 101’s terms suggest that new technologies may call for new inquiries.”). Technology without anchors in physical structures and mechanical steps simply defy easy classification under the machine-or-transformation cate- gories. As the Supreme Court suggests, mechanically applying that physical test “risk[s] obscuring the larger object of securing patents for valuable inventions without transgressing the public domain.” Id. at 3228. ULTRAMERCIAL v. HULU, 7, 8, (CA Fed. 2011)

AI, my mission is not to discredit DCAT. I simply point out that you do not even understand what you are saying, as to suggest that "marketplace" processes are within the processes to which math can be applied be eligible for patenting under Diehr is the reason I so strongly suggest that you have no clue.

You simply cannot understand, can you, people discussing issues, making points and counter points. We actually listen to each other. Naturally, we do not agree on every nuance, but that is the beauty of rational discussion.

With you, nothing is rational. You view the discussions here as some kind of holy war where everyone has agendas. If anyone does not cow tow to you, you label them anti-patent, or worse. You do not want to discuss issues. You want to fight.

Here, why are you twisting what I said into its opposite? Here we go again, indeed. You are persistent in your intentional goal post moving, your mendacious use of strawmen and your diversion of attention.

Sell to a consumer a commodity at a fixed price (over a period), and buy from a supplier at a second fixed price, where there is a risk to both of some future event happening and where the risks are counter. The price of purchase of the second commodity is set to some degree by the degree of counter risk, but the total quantity of the commodity bought has to be be the same as that sold.

Example, coal for furnaces. If the winter is cold, the price of coal will rise. I, as a broker, can agree to sell the consumer coal a fixed price regardless of weather and price fluctuations if I have contracts in place to buy from coal suppliers over the same winter at a fixed price.

I too, at first, did not identify Ned as a Shill until I looked closely at the pattern and evidence pointed out to me by others.

Unlike Annie Mouse, whom Ned successfully drove away from the discussions with his attacks, I do not think Ned is insane.

I simply think he is paid to repeatedly copy and past a philosophical view of the law , that is not the law.

Even after I provided the proper pin-cites to Supreme Court cases that totally undermined, and discredited his theories and views, all Ned did was make a couple of lazy juvenile insults, wave his hand, and go back to copying and pasting his original argument.

It’s evident, that Ned is rewarded in some fashion to continue repeating his mantra over and over no matter what evidence is presented, or whom presents it.

So while I disagree that Ned is insane per se, I do see that to participate in such a circular discussion can be tantamount to the willful practice of cyclical insanity.

IBP, I think you read way too much into preamble. The preamble could have said simply: process.

Regarding the utility actually identified, the risk you are minimizing is the risk to consumer of a price spike due to unforeseen conditions. That, is quite useful, especially if you are on a fixed income.

Ned if you are so much more learned when it comes to the law then why can’t you simply dispose of my arguments with the law?

The other attorneys here disagree with you in this particular debate as well but your response to them is either to ignore, attack, or accuse them all of being me posting under different names.

Have you noticed that not even MM, or 6 will come to your aide? Even IBF disagreed with you early in this thread and you simply went on to another topic.

Ned, the entire patent community can’t be wrong and you right. And even if that was true, you could at least present the case law that proves it. In fact one would think you would be compelled to do so.

To date your only rebuttal has been to in effect say,”AI is wrong and Ned is right because I am smarter than AI.”

Yet, you have failed to demonstrate that in a way that any third party could objectively verify.

If your argument can’t stand up to the rigors of logic and is therefore found faulty, then the gentlemanly and scholarly thing to do is concede defeat. Attacking me personally does not save your argument.

You use the word “clue” as if it is a test. Yet, you have failed to demonstrate with any case law, logic, or fact that “clue” and “test”, have the same meaning.

When this deficiency in your reasoning is pointed out your only response is

“You are borderline irrational.” A mere personal attack, and a non answer.

Such behavior speaks volumes about your online veracity in a debate and discussion.

I agree in principle. Laws of nature and phenomena of nature are old, but more than this, they had a common resource of all mankind. They differ from the prior inventions of man that are lost and can be rediscovered and patented, in that they are not the product of man’s genius, but of God’s.

Abstract ideas are potentially useful, but are not patentable until usefully applied. Thus the patent laws seem to suggest there is a difference between potential usefulness and actual usefulness.

IBP, " In this case, the court uses the term "abstract" instead of "pre-emption" to describe their conclusion that the asserted utility was totally non-specific, and was not limited in any way. "

"Not limited in any way" to what? I think this preemption concept works in the case of mathematics because mathematics is used to calculate something and can be applied to many different applications. Hedging, is not the same thing. It is itself an application of mathematics to a specific use. This is where the confusion begins in Bilski.

Preemption of an abstract idea, a law of nature, or thing of nature is the prohibited vice. Preemption of something which is not a law of nature, a thing in nature or an abstract idea is permitted by the patent laws unless the subject matter preempted is unpatentable as a category for some other reason, such as for it being a business method.

Thus, having determined that business methods were not categorically excluded, the Supreme Court had no choice but to declare that hedging was abstract. But clearly hedging is not abstract when it is claimed the way it was claimed the Bilski as a series of steps that were physical in nature and continued until "risk," a mathematical calculation not different from the mathematical calculation in Diehr, was balanced.

There is no meaningful difference between the claimed process of
Diehr and the claimed process of Bilski except that the process in Bilski did not pass the MOT, and therefore was not a traditional process within the holding of Diehr. But to say that the claims were not patentable because did not pass the MOT was another problem the Supreme Court faced in Bilski having just declared that the MOT was not an exclusive test.

So we are left with an impossibility, an absurdity. The holding in Bilski makes no sense to the extent one tries to frame the decision within the context of the Supreme Court's prior case law. In the end, the Supreme Court simply declared the hedging method to be abstract, thus throwing the whole jurisprudence of section 101 into chaos.

Now, after all that, the claim could also be analyzed from the perspective of the definition of a “process”, and whether the “process” of 100 and 101 requires something like cooperation of the method steps. Although there is SC language on this point, it need not be explored here.

The easiest, most elegant way would be to declare that “consumption risk costs” have no corporeal manifestation, are therefore the assertion of utility is insubstantial in violation of the substantiality of utility requirement of 101. The preamble is always limiting, and voluntarily-made assertions of utility consciously decided by the applicant/patentee to have been included within the claim should entirely circumscribe any determination of fulfilment of the utility requirement of 101.

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I disagree with the court on specificity, though–I believe that a field-of-use limitation alone can be a meaningful limitation on the scope of the claim, and that it therefore can successfully impart specificity to the assertion of utility.

Assuming that the claim does not have the problems that I have analyzed above, IMHO there are limitations in the claim that impart sufficient specificity to the assertion of utility to satisfy the specificity of utility requirement of 101, and that the claim is therefore not “abstract” as labeled by the court.

Assuming that the above analysis of gerund phrase 1 is incorrect and that initiation of fixed-price sales transactions does actually affect consumption risk costs, the question becomes whether the inclusion of gerund phrases 2 and 3 continues the affecting of said costs–that is, when gerund phrases 2 and 3 are considered in combination with gerund phrase 1, the three gerund phrases taken together perform operations on the consumption risk costs.

Again, I’m no economist–but it seems to me that there is no way that they could, unless gerund phrase 1 transferred said costs from the purchaser to the commodity provider, which costs were somehow transferred by gerund phrases 2 and 3 to the market participants. In other words, if gerund phrase 1 served to transfer the costs from the purchaser to the provider, which costs were then lowered by the purchase transactions required by gerund phrase 3 with the market participants identified by gerund phrase 2, the costs would actually be affected…

BUT even if that were true, gerund phrase 3 suffers from the same logical defect as does gerund phrase 1–merely initiating the series of purchasing transactions does not actually affect said costs, it only potentially affects said costs, the realization of the effect coming upon the performance of the obligations under said sales contract, and that the first gerund phrase cannot logically effect the utility asserted in the preamble. The totality of the 3 gerund phrases and the preamble could therefore not affect the consumption risk.

Considering the claim as a whole, therefore, the assertion of utility is therefore not credible, as the totality of the gerund phrases and the preamble do not achieve the stated object of the claim.

It must now be determined if the gerund phrases, in their totality, actually affect the costs associated with the consumption risk in any way–or in other words, whether they require that some actual operation be performed on said costs.

If the first gerund phrase were the only gerund phrase, it would by itself appear to affect the costs associated with the consumption risk, potentially changing their magnitude, or their distribution in time. However, requiring a high standard of applicants/patentees and being very precise, I would observe that the mere “initiation” of a series of sales transactions does not actually affect said costs, it only potentially affects said costs, the realization of the effect coming upon the performance of the obligations under said sales contract, and that the first gerund phrase cannot logically effect the utility asserted in the preamble.

The second and third gerund phrases cannot in any way affect the consumption risk costs, either alone or considered in combination with gerund phrase 1. Considering the claim as a whole, therefore, the assertion of utility is therefore not credible, as the totality of the gerund phrases and the preamble do not achieve the stated object of the claim.

But regardless of the specific meaning of the term “management”, he preamble itself does not appear to logically state a credible utility. Consider that according to the preamble, “consumption risk costs” are a quality of “a commodity sold by a commodity provider at a fixed price”. Although I’m no economist, it is my understanding that said commodities sold at a fixed price do not exhibit consumption risk costs, and that the assertion of utility is not credible.

101 fail, and 112p1 fail.

In the event that I’m misunderstanding something economically, I will proceed, assuming that the preamble does in fact assert a credible utility.

What is meant by “management” of said costs? “Management” is an expansive term, and includes the many ways of actually affecting said costs–affecting the amount, the phasing, the allocation, the medium, the organization, the coordination, or the supervision, etc. of said costs; that is, “management” requires that some actual operation be performed on said costs. Considered in isolation, the term “management” is non-specific, as just described–but, the claim must be considered as a whole. Therefore, both the remainder of the preamble and the gerund phrases must be construed to determine if they provide an unambiguous and specific definition for the term “management” as appears in the assertion of utility in claim 1.

IMO the remainder of the preamble is of no assistance in increasing the specificity of the term “management”.

The statement of the object expressly discloses that it is the “consumption risk costs” that are the “object” upon which the gerund phrases act. What are “consumption risk costs”? The noun “risk” is broadly defined as a situation involving exposure to danger. “Consumption risk” is the exposure to the danger of loss resulting from the activity of consumption, or more accurately, the pattern of the activity of consumption. The consumer is the party that experiences the situation wherein there is an exposure to the danger of loss, and it is the consumer who thus experiences the “consumption risk”. In the absence of any agreement to the contrary, wherein another party agrees to bear the costs associated with that risk, it is the consumer who will bear said costs.